Tennessee delegation says Erlanger in hands of Hamilton County Commission

Tennessee delegation says Erlanger in hands of Hamilton County Commission

March 15th, 2013 by Louie Brogdon in Local Regional News

The Erlanger Baroness campus.

Photo by Staff File Photo /Times Free Press.

Some Hamilton County commissioners don't like parts of the legislation to reform Erlanger Health System's governing board. And state legislators say if the commission kills the bill, it will not be resuscitated.

The commission's Legal Committee decided Thursday to postpone a conversation on the private act reforming the hospital's board. The bill cleared the state House and Senate and was signed last month by Gov. Bill Haslam. Commissioners must ratify it before it can take effect.

Committee Chairman Jim Fields said Thursday he wanted to read the signed legislation before deciding whether to place it on Wednesday's voting agenda.

Some commissioners say they won't vote to ratify the bill in its current form. Commissioners have two main problems with the bill.

First, the county would have no say over who sits on the health system's initial, self-perpetuating board.

Second, the bill locks Hamilton County into paying $1 million a year to the health system for five years, then adjusts the figure annually based on the Consumer Price Index. The index is a measurement of changes in retail prices in a variety of goods.

The county now contributes $1.5 million per year to the hospital to help offset the cost of indigent care. That represented less than 1 percent of Erlanger's $563 million in revenue for 2012. Hospital officials said Erlanger provided $85 million in uncompensated care last year.

Commission Chairman Larry Henry said this week he's heard concerns from every commissioner.

And Henry himself is not too keen on binding future county officials to a financial obligation tied to the CPI. But Henry said he wanted "some discussion on it" before he would decide to vote the bill up or down.

"We're obligated for $1 million for the next five years, but that could be a significant change when it's tied to CPI," Henry said.

Commissioner Warren Mackey said early this week he wants decisions about the public hospital to be made "as close to the source as possible."

The legislation says initial board members will be county residents selected by the local delegation in consultation with the county mayor. The General Assembly will appoint the board based on the delegation's recommendations.

Mackey said either the money or appointment issue is enough to keep him from voting to ratify the bill.

Commissioner Greg Beck doesn't like the monetary obligation, either, but that's because he thinks the county should pay more.

"What we're giving them comes nowhere near what the expenses are," Beck said.

Beck does take issue with the appointment process for the initial board.

"If we relied on them to make the board appointments, not one of our constituents would be able to come to a commission with a complaint about Erlanger. We wouldn't have any say over it," Beck said.

Commissioner Marty Haynes said he has concerns but won't decide how he will vote until it comes before the commission. And Commissioner Fred Skillern said he has "more than one problem" with the legislation, but he declined to elaborate, citing a need to speak with legislators.

Commissioner Tim Boyd has longstanding concerns about the appointment of the initial board, the county's obligation being tied to the CPI and a list of other perceived problems.

Boyd's main complaint is the County Commission has been "left out of the loop" on the whole process.

Sen. Todd Gardenhire, R-Chattanooga, who sponsored the bill in the Senate, said leaving the commission out was intentional.

"What we are trying to do is to get the politics out of deciding who sits on the board," Gardenhire said.

Lawmakers wrote the bill to steer the troubled hospital back into the black. Erlanger had been leaderless since trustees axed Jim Brexler as chief executive in December 2011, after the hospital lost $6 million and droves of doctors within a five-month span.

Brexler was the third CEO to leave the hospital in nearly two decades. All walked with sweetheart severance packages.

In January 2012, the hospital was down $12 million in revenue. By comparison, it was only $2 million short of budget estimates in the same month this year under interim administrator Charlesetta Woodard-Thompson.

Last month, board members hired Kevin Spiegel, CEO at Methodist University Hospital in Memphis, on a three-year contract to lead the hospital.

If the county doesn't OK the new bill, Gardenhire said he's finished dealing with Erlanger issues.

"Then they're totally responsible for what happens at Erlanger -- totally responsible," Gardenhire said.